Hot Inflation Report Cements Fed Rate Hike in December

Dow Jones11-10

1003 ET - A December rate hike by the Federal Reserve is effectively signed, sealed and delivered following the hot October core CPI reading, Franklin Templeton Institute's Jeff Schulze says in a note. That's particularly true after Governor Waller's notably hawkish remarks yesterday, Schulze says. Waller pointed out that hot inflation could justify a half-point rate hike, rather than just the quarter-point jump that the market had been pricing in. A steady labor market is giving the Fed ample flexibility to fight inflation that has been running above its 2% target for more than five years, Schulze says. Today's report showed continued stickiness from September, with core goods and shelter continuing to run above trend, he says.

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